Chewy Inc (CHWY, Financial), a leading e-commerce company in the pet care industry, has recently seen a notable uptick in its stock performance. With a current market capitalization of $10.09 billion and a stock price of $23.39, Chewy has experienced a 7.01% gain over the past week and a 12.92% gain over the past three months. This positive trajectory is underscored by the GF Value of $49.65, which suggests that the stock is Significantly Undervalued, a consistent status from its past GF Value of $73.69.
Chewy Inc: A Dominant Player in Pet Care Retail
Chewy Inc, operating within the cyclical retail industry, has established itself as the largest e-commerce pet care retailer in the U.S. The company, which was founded in 2011 and went public in 2019 after being acquired by PetSmart, generated a staggering $10.1 billion in sales in 2022. Chewy's product offerings span across pet food, treats, over-the-counter medications, medical prescription fulfillment, and hard goods such as crates and leashes. This diverse range of products has positioned Chewy as a one-stop-shop for pet owners, contributing to its robust market presence.
Assessing Chewy's Profitability
Chewy's Profitability Rank stands at 4/10, reflecting its position relative to industry peers. The company's Operating Margin is currently at 0.11%, which is better than 30.12% of its industry counterparts. Additionally, Chewy's Return on Equity (ROE) is at 4.03%, surpassing 44.49% of its peers. The Return on Assets (ROA) and Return on Invested Capital (ROIC) are at 0.42% and 0.73% respectively, both outperforming a significant portion of the industry. Despite these figures, Chewy has only achieved profitability in one of the past ten years, indicating room for improvement in this area.
Growth Trajectory of Chewy Inc
Chewy's Growth Rank is an impressive 7/10, showcasing the company's strong expansion in revenue and profitability. The 3-Year Revenue Growth Rate per Share stands at 24.70%, which is higher than 86.18% of companies in the same industry. The 5-Year Revenue Growth Rate per Share is even more remarkable at 34.70%, surpassing 95.52% of industry peers. Looking ahead, Chewy's Total Revenue Growth Rate is estimated at 7.24% for the next 3 to 5 years, and the EPS without NRI Growth Rate is projected at an extraordinary 70.16%, indicating a bullish outlook for the company's financial growth.
Notable Shareholders in Chewy Inc
Chewy's shareholder base includes prominent investment firms such as Baillie Gifford (Trades, Portfolio), holding 15,828,388 shares, which translates to a 3.67% share percentage. Steven Cohen (Trades, Portfolio) is another significant shareholder with 3,264,435 shares, amounting to a 0.76% share percentage. Additionally, Jim Simons (Trades, Portfolio) holds 3,071,300 shares, representing a 0.71% share percentage. These holdings reflect the confidence and interest of savvy investors in Chewy's market potential and growth prospects.
Chewy's Competitive Landscape
When compared to its closest competitors, Chewy stands strong with a market cap of $10.09 billion. Vipshop Holdings Ltd (VIPS, Financial) has a market cap of $9.05 billion, while Etsy Inc (ETSY, Financial) boasts a slightly higher market cap of $10.49 billion. Maplebear Inc (CART, Financial) trails with a market cap of $7.08 billion. This competitive analysis highlights Chewy's significant presence in the retail - cyclical industry and its ability to maintain a competitive edge against its peers.
Conclusion: Chewy Inc's Market Position and Future Outlook
In summary, Chewy Inc's recent stock performance and valuation indicate a company that is significantly undervalued, with a strong growth trajectory and a solid base of institutional investors. The company's profitability metrics, although not leading the industry, show a competitive edge in certain areas. With its impressive growth rates and positive future revenue and EPS estimates, Chewy is well-positioned to capitalize on the expanding e-commerce pet care market. The company's performance, when juxtaposed with its competitors, underscores its potential for continued success and value creation for shareholders.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
